InvestorQ : What is the latest update on the Karvy case? I am having a broking account with Karvy and they are not disbursing the funds in my account. What should I do?
shrinidhi Rajan made post

What is the latest update on the Karvy case? I am having a broking account with Karvy and they are not disbursing the funds in my account. What should I do?

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Riya Dwivedi answered.
2 years ago
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Let me first give you an update on what exactly is happening at Karvy. You must be aware that SEBI had imposed a ban on Karvy taking on fresh account openings. The chairman of Karvy, C Parthasarathy, had assured his clients that the ban was only on fresh accounts openings and using the power of attorney to debit client DP accounts. But the problem is much more practical. Both NSDL and CDSL are being a lot more cautious and all debit instructions coming from Karvy are being doubly scrutinized. This is delaying the capacity of traders to place orders at Karvy and even their decision to shift the trading accounts and demat accounts to a different broker is facing a hitch due to this reason.

The latest update is that Karvy has now approached the Securities Appellate Tribunal (SAT) saying that the SEBI order is making it impossible to continue their operations and hence the order should be set aside. The SAT response is expected on Friday itself so then we will know the future status of what exactly happens to Karvy. But the case does look complicated because as per the SEBI order, Karvy had allegedly pledged shares worth Rs.2000 crore belonging to 95,000 clients and raised Rs.600 crore without the consent of the account holders. That is a serious issue and SAT may not be too keen to help out.

As a client of Karvy, you first need to ensure that your demat account and ledgers are ok and immediately make an application to Karvy to transfer your demat account and trading account to another broker. This may take time but you must also escalate this issue through NSDL, CDSL, NSE, BSE and also through SEBI.



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